Hello and welcome to the annual meeting of shareholders of The Clorox Company. Please note that today's meeting is being recorded. During the meeting, you will have an opportunity to ask questions. You can submit questions or comments at any time by clicking on the Q&A icon at the top of your screen. It is now my pleasure to turn today's meeting over to the independent chair of the board, Matthew Shattock. Mr. Shattock, the floor is yours.
Thank you. Good morning. I'm Matthew Shattock, independent chair of the board of The Clorox Company. On behalf of the board of directors, I'd like to welcome everyone and thank you for joining us for our virtual annual meeting of shareholders. Before I get started, I'd like to ask that you please read the forward-looking statement that's currently displayed on the screen. A copy of the agenda and a list of the rules of conduct for the annual meeting are available online on the meeting website. We ask that you cooperate in following these guidelines. As you heard from the operator, you will have an opportunity to ask questions during this meeting. Shareholders of record and proxy holders who provide their valid control number will be able to ask questions during the meeting by typing and submitting the question using the Q&A icon at the top of your screen.
If we're unable to respond to all properly submitted questions due to time constraints, we'll be posting responses to submitted questions on our investor relations website after the meeting. Now, before getting into the formal business portion of the meeting, I'd like to introduce our independent directors who are on the line today. I'll introduce them individually. Amy Banse was elected to the board in September 2016. She is a venture partner with Maestri Inc. Julia Denman was elected to the board in May 2022. She is corporate vice president and head of internal audit, enterprise risk, and compliance of Microsoft Corporation. Spencer Fleischer was elected to the board in July 2015. He is chairman of FFL Partners LP. Esther Lee was elected to the board in August 2013. She is the former executive vice president, global chief marketing officer of MetLife Inc.
David MacKay was elected to the board in August 2016. He is the former president and chief executive officer of Kellogg Company. Paul Parker was elected to the board in November 2020. He is the senior vice president, strategy and corporate development for Thermo Fisher Scientific Inc. Stephanie Plaines was elected to the board in May 2022. She is the chief financial officer of JC Penney. Kathee Tesija was elected to the board in May 2020. She is the former executive vice president and chief merchandising and supply chain officer of Target Corporation. Russell Weiner was elected to the board in February 2017. He is chief executive officer of Domino's Pizza. Christopher Williams was elected to the board in July 2015. He is chairman of Seabird Williams Shank and Co.
I, Matthew Shattock, was elected to the board in August 2018 and am the former non-executive chairman of Beam Suntory Inc. Also joining us today is Linda Rendle, who was elected to the board in September 2020. Linda recently completed her third year as CEO of Clorox and has continued to show outstanding leadership focused on building a stronger, more resilient company and creating long-term value for shareholders. I'm also joined today by Kevin Jacobsen, our Chief Financial Officer, who, along with Linda, will be presenting today. We also have Sarah Chin from our corporate communications team, who will assist us with the Q&A portion of our meeting. Additionally, I'd like to mention that representatives from Ernst & Young LLP, the company's independent registered accounting firm, are on the line today.
Now, before we get started, I'd like to remind you that the board of directors fixed the close of business on September 22, 2023, as the record date for the determination of shareholders entitled to vote at this meeting. Notice of the meeting was sent to each shareholder of record, and a quorum is present online or by proxy. Kari Altig, on behalf of ComputerShare, the company's transfer agent, has been appointed inspector of elections for this meeting. She is on the line today and will supervise the voting. I now declare the polls open. The polls will close after all proposals have been presented. To expedite the flow of business, we intend to adhere to the following format.
Each of the items of business to be acted upon by shareholders will be proposed in the order set forth in the proxy statement, but the vote on each item will be deferred until all of the items of business have been presented. The first matter to be considered at this meeting is the election of directors. The following individuals have been nominated to the board of directors upon the recommendation of the Nominating Governance and Corporate Responsibility Committee to serve as directors until the next annual meeting of shareholders or until their earlier resignation or removal. Amy Banse, Julia Denman, Spencer Fleischer, Esther Lee, David MacKay, Paul Parker, Stephanie Plaines, Linda Rendle, Matthew Shattock, Kathee Tesija, Russell Weiner, and Christopher Williams. The board of directors recommends that shareholders vote for the election of each of the director nominees.
The second item of business is approval on an advisory basis of the compensation of the company's named executive officers, as set forth in our proxy statement. The Board of Directors recommends that shareholders vote for the advisory vote on executive compensation. The third item of business is an advisory vote on the frequency of future advisory votes to approve the compensation of the company's named executive officers, as set forth in the proxy statement. The Board of Directors recommends that shareholders vote for the option of one year for the frequency of future advisory votes to approve executive compensation. The fourth item of business is the ratification of the selection of Ernst & Young LLP as the company's independent auditors for the fiscal year ending June 30, 2024.
The board of directors recommends that shareholders vote for the ratification of the selection of Ernst & Young LLP as the company's independent auditors. Sarah, are there any questions on any of the proposals?
No, there are no questions on the proposal. There are no additional questions relating to the proposal.
Thank you. To all of our shareholders, if you have returned your proxy card, voted by telephone, or voted online, it is not necessary for you to vote here today unless you wish to change your vote. If you'd like to vote your shares now, please navigate to the vote icon on the meeting center section of the screen and follow the prompts. I now declare the polls closed. Now I will announce the results of the voting. I'm advised by the inspector of election that, based on the preliminary vote results, on the election of directors, each of the 12 director nominees has received at least 97% votes cast in favor of their election and has been elected to a one-year term expiring at the annual meeting in 2024 and until their successors are elected.
The approval on an advisory basis of the compensation of the company's named executive officers has been approved with at least 93% votes cast in favor. The advisory vote for the frequency of future advisory votes to approve the compensation of the company's named executive officers has been approved with a frequency of one year with at least 97% votes cast in favor. The ratification of the selection of Ernst & Young LLP has been adopted with at least 95% votes cast in favor. That concludes the formal business of our meeting, so the meeting is now adjourned. Now that the annual meeting is adjourned, we will share a presentation on our Ignite strategy progress from our CEO, Linda Rendle, and a financial update from our CFO, Kevin Jacobsen.
Thanks, Matt, and hello, everyone. I hope you're doing well. Today, I'll share highlights of our fiscal year 2023, our priorities to address short-term challenges, and how, through our Ignite strategy and portfolio of consumer-love brands, we plan to continue taking the right steps to build a stronger, more resilient company and create long-term value for shareholders. We had a strong fiscal year 2023 amid challenging operating conditions, delivering progress across our Ignite strategic priorities, all while living our purpose and values. As Kevin will share shortly, we delivered on our commitment to drive top-line growth and rebuild margins while continuing to invest in the long-term health of our brands, categories, and capabilities. Our performance reflects the strength and resilience of our portfolio. In fiscal 2023, we launched consumer-inspired innovation across all our major brands, further strengthening the superior value of our products.
At the same time, we prioritized investments in our brands to support their long-term health and consumer loyalty. We hit an all-time high return on our marketing investment in fiscal 2023, in part due to our personalization efforts, where we've nearly achieved our 2025 goal to know 100 million consumers in the US. We also continue to invest in our digital transformation and implement our new operating model to create a more consumer-obsessed, faster, and leaner company and drive growth and productivity. Through it all, we made progress in advancing our integrated ESG goals in the areas where we can have the biggest impact. This included introducing new cleaning products with EPA Safer Choice and Design for the Environment certifications and more transparency around our ingredients.
We also took steps to build a more inclusive and equitable workplace, enhance our ESG governance structure and processes, and address some of the biggest challenges facing our industry, such as reducing plastic and other waste and taking climate action. That brings us to today. We started this new fiscal year with momentum. Prior to the previously announced cyber attack in August, our performance was on track with our expectations, a testament to the strength and superior value of our brands and the role they play in consumers' daily lives. While the cyber attack caused wide-scale operational disruptions, we believe we're now on a solid path to operational recovery. We're laser-focused on the immediate priorities ahead of us: rebuilding retailer inventories, preserving merchandising activity, and improving distribution.
As we navigate the near term, we remain committed to growing the top line and rebuilding margins, including delivering consumer-centric innovation through bigger, stickier platforms focused on value superiority, building our brands through ongoing investments in advertising and sales promotion that drive consumers to our portfolio of trusted brands, continuing to lean into our hallmark cost savings program, building off the record savings achieved last year and the strong performance in the past quarter, and advancing our digital transformation and streamlined operating model to drive greater growth and productivity. Looking ahead, the recent disruptions from the cyber attack do not change the Clorox story. As we execute our recovery efforts, we're committed to advancing our Ignite strategy, including our ESG goals, to build a stronger, more resilient company that delivers consistent, profitable growth over time. We have leading brands consumers love.
We play in essential categories, and our business is well-positioned to benefit from lasting consumer demand tailwinds. We continue to have high conviction in our ability to deliver on our 3-5% long-term sales growth target. We have proven that we can execute and miss challenges just as we did coming out of the pandemic, and I'm confident in our ability to do so again, given the strength of our brands, the relevance of our Ignite strategy, and the relentless focus of our teams on executing with excellence to win in the marketplace and create enduring value for all of Clorox's stakeholders. Thank you for your time. I'll now turn it over to Kevin to provide you with a financial update.
Thank you, Linda. At Clorox, we have a long history of creating value for our shareholders. I'll start today by sharing a high-level summary of our fiscal year 2023 performance and our updated fiscal year 2024 outlook that factors in the impact of the recent cyber attack, as well as our confidence in our ability to continue to drive long-term shareholder value. We delivered strong results for fiscal year 2023. Net sales increased 4% within our long-term target range, and organic sales increased 6%, reflecting growth in three of our four reportable segments. Gross margin increased by 360 basis points, primarily driven by our cost-justified pricing actions and a record year for cost savings. This resulted in a 24% increase in adjusted earnings per share. As Linda mentioned, after entering fiscal year 2024 with solid momentum, the August cyber attack caused wide-scale operational disruptions that impacted our Q1 financial performance.
First quarter net sales declined 20%, driven by lower volume from the depletion of customer inventory levels and lost consumption as a result of the cyber attack. Still, we were able to deliver 240 basis points of gross margin improvement, supported by the benefits of cost-justified carryover pricing actions and another strong quarter of cost savings. After taking into account all these factors, adjusted earnings per share for the first quarter was $0.49, in contrast to $0.93 in the same quarter last year, a 47% decrease. We updated our fiscal year 2024 outlook to reflect the impact of the cyber attack, while other key assumptions are largely unchanged.
We expect net sales to be down mid to high single digits for the year, a range that is wider than normal to reflect the degree of variability related to the pace at which we're able to rebuild customer inventory levels, distribution, and market shares. We also anticipate gross margin to be about flat for the year. Net of all these factors, we now expect adjusted EPS to be between $4.30 and $4.80 a share, a decrease of 16% to 6%. Now, let me share with you why we remain confident in our ability to execute against our immediate priorities Linda shared, all while driving long-term shareholder value. We remain committed to our Ignite strategy's annual long-term financial targets. First, our annual sales goal is to grow 3% to 5%, and we target 25 to 50 basis points of EBIT margin expansion.
Also, we continue to target 11%-13% free cash flow as a percent of sales. We're proud that Clorox has a long history of strong cash generation. This enables us to invest further in our brands while being disciplined in our approach to how we deploy cash in the best interest of our shareholders. This includes prioritizing reinvesting in our business through innovation and consumer engagement by our brands to build household penetration and further widen our competitive moat. We're also taking steps so that Clorox is set up to succeed in the future, including a $500 million investment in our digital transformation in order to create a more consumer-obsessed, faster, and leaner company and maximize our ability to grow and operate more efficiently.
Our ability to make these investments is fueled by our hallmark cost savings program and operational excellence, along with cost-justified pricing and our new streamlined operating model. Importantly, Clorox is a strong generator of cash. We delivered 12.6% free cash flow in fiscal year 2023, returning to our goal range of 11%-13%. We have a long history of providing value to you, our shareholders, through regular dividend payments and annual dividend increases, including our most recent increase to $1.20 per share, which we announced in July. Over the past five years, we've returned more than $4.5 billion to our shareholders through our dividend and share buyback programs. We remain focused on things we can control. Despite challenges from the recent cyber attack, we remain committed to our long-term strategies for growing the top line and rebuilding margins, and the case for Clorox remains strong.
Clorox has a solid foundation and the right plans in place to address the immediate challenges while continuing to advance our Ignite strategies in support of creating long-term shareholder value. I'd like to thank you for your long-term loyalty to our company, and we now welcome your questions.
Thank you, Kevin. We'll be answering questions that were submitted prior to the meeting and also during the meeting. If you have a question or comment, you may submit it by clicking on the Q&A icon at the top of your screen. If you have submitted a question prior to the meeting, it is not necessary for you to resubmit here today unless you have an additional question. We will be addressing questions that are consistent with the rules of conduct for this meeting. A copy of the rules can be found in the Meeting Center section of your screen on the meeting website. We will be reading questions verbatim, and we will group any questions that are substantially similar and answer them together to avoid repetition. We will also be posting the Q&A on our Investor Relations website after the meeting. Sarah, do we have any questions?
No, there are no questions.
Thank you. That concludes the 2023 Annual Clorox Meeting of Shareholders. On behalf of everyone at Clorox, thank you for participating in today's meeting and for continuing to put your trust in our company.
This concludes the meeting. You may now disconnect.